I usually max out storage on all devices, but I went with the 16 GB wifi only, and I have zero regrets. It rarely leaves the house, and we're almost always someplace with a hotspot anyway, so I didn't see the need for 3G. With almost 70 apps installed, I've used about 2.2 GB total. No music, that's what the iPhone is for--it docks with my speakers. No video, that's what the bigass TV my husband had to have is for (and baseball looks better on a 50" widescreen plasma, right? LOL). Very few books, because I have over 300 stored in Amazon's Kindle cloud. That leaves pictures, and those will either only be on the iPad long enough for fast processing, or because they're part of my wallpaper collection. Just a handful of personal pics will be on there long term--the rest are on hard drives at home. If I want regular access to certain ones, Photobucket has a fine app for accessing my account. Why clutter up my iPad for that?
Besides, buying the smallest iPad means I can justify upgrading when version 2.0 arrives next year.
My husband went with the 32 GB 3G--he likes movies, loaded his up with music, and filled it with games. He also wanted 3G so he could use it outside the house more easily. Different people, different needs. Think about what you want to do with yours, and that should tell you what model makes the most sense for you.